Iola City Council members will reconvene next week to finalize the citys 2020 budget, but only after an additional $421,000 worth of spending is pulled from the plan.
The edict came following an hour-long discussion over myriad topics, including the citys financial health; a looming health insurance premium hike that could be even larger than originally predicted; and how Saturdays Iola Register caused a much bigger headache for city leaders than was warranted.
By the end of Mondays meeting, Council members directed City Administrator Sid Fleming to cut $421,000 out of the citys general fund budget for the upcoming year, which Mayor Jon Wells warned could affect such things as recreation programs, the library and Bowlus Fine Arts Center.
Because the deadline to submit the 2020 budget to the state is prior to the Councils next regular meeting Aug. 26, Fleming said he would schedule a special meeting next Monday for ratification.
The sticking point for the Council is the citys general fund, which was projected to spend out about $7.6 million, while bringing in about $7.2 million in 2020. The excess spending was possible, Fleming said, because of leftover cash reserves the city already has in the bank.
$1.8 MILLION SHORTFALL DOESNT TELL WHOLE STORY
As the headline in Saturdays Register indicated Proposed city budget $1.8 million out of balance the spending plan Fleming presented to the Council projects total revenues at a shade more than $28 million in 2020, with expenditures forecast at $29.9 million.
But that only paints part of the picture, he said, which is what has everybody wound up.
Out of our spending in this budget, $1.89 million is tied directly to capital improvement projects (CIP), Fleming said.
In those cases, the city has set aside savings over the past few years in a number of maintenance and construction departments, for a number of departments.
This is an investment in our future, Fleming said. It makes you look like youre imbalanced, even though youve saved money (for these projects) for 10 years.
The citys unencumbered balance, which went from $9 million at the end of 2016 to $11 million in 2017 and $12.5 million at the end of 2018, is forecast to be at about $11.8 million by the end of 2020, Fleming noted.
The important thing, in my mind, is the ending balance in each of those funds, Fleming said.
With this proposed budget, were not increasing property taxes, and our sales tax is set, he continued. The only thing were proposing is to spend down some of the reserve, with our CIP.
Whats more, the city over the past two years avoided projected shortfalls, because weve watched our spending, the city administrator continued.
Theres a balance between having reserves, and just continually cutting things and not spending down the reserve at times, Fleming said.
